Hungary Inflation


Hungary: Inflation ticks up in August to the highest rate in eight months

September 12, 2014

In August, consumer prices fell 0.2% over the previous month, which contrasted the 0.2% increase observed in the previous month. The fall reflected that a decrease in prices for food, clothing and footwear more than offset an increase in prices for services.

Annual inflation inched up from 0.1% in July to 0.2% in August, thus reaching the highest rate in eight months. The figure met market expectations. As a consequence, annual inflation still remains well below the Central Bank’s target of 3.0%, with a tolerance margin of plus/minus 1.0%. The core inflation index, which excludes volatile items such as fresh food and fuel, rose 0.1% over the previous month (July: +0.2 month-on-month). Meanwhile, annual core inflation inched down from 2.5% in July to 2.4% in August, which marked the lowest rate in four months.

In its June inflation report, the Central Bank projects that inflation will be zero at the end of 2014 and then increase to 2.5% at the end of 2015. FocusEconomics panelists’ projection is not in line with the Central Bank’s forecast as the panel sees 2014 year-end inflation at 1.3%, which is down 0.2 percentage points from last month’s projection. Next year, the panel expects inflation to rise to 2.9%.

Author: Teresa Kersting, Economist

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Hungary Inflation Chart

Hungary Inflation August 2014 0

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: Hungarian Central Statistics Office.

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